Fake pricing claims could boost local business

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Fake pricing allegations against national retailers may boost local businesses who are adamant they can compete on both price and service.

Island businesses have welcomed the investigation by the Office of Fair Trading (OFT) who have accused some large mainland-based retailers of misleading customers with ‘fake pricing’.

Locally based businesses often struggle to convince customers that they can offer the same, if not better, prices than the multi-national stores who are backed by mega advertising drives.

However local firms stress they can provide the same, if not better services than large chain retailers.

Their views may be backed up by the news that the OFT has indicated they have found evidence of artifically inflated prices from some retailers. These prices make out that carpets, flooring and furniture have had massive prices cuts when in fact they were never offered for sale at the higher price.

Rory Macgillivray of Macgillivrays Floor Furnishings said customers had to ask themselves exactly what they were paying at the end of the day.

“How much are you writing that cheque out for?” he said.

“The deals are not what they appear to be, and you have to consider how much are you paying at the end of the day.

“There is nothing worse then thinking you have a fantastic deal and finding out it was cheaper locally.”

“We are happy to price match any body.”

Many believe the sales techniques used by large companies are damaging to local stores who can often offer comparitive prices on people’s doorsteps.

Mr Macgillivrary said it had created a ‘culture of discount’ where people wanted to know how much was taken off the price to make them feel they were getting a bargain.

He said it would be easy for small firms to follow this trend and mark up items as having huge savings on them but it was not a road they wanted to go down.

“I would love it if the OFT could cut out all this nonsense,” he said pointing out that some large retailers re-brand products like carpets to ensure they cannot have a price comparison anywhere else, when in actual fact that product could be in your local shop for the same price.

At Carpetworld in Stornoway, Dolan Morrison said this kind of practice had been going on for years and he believed it had been looked into back in the 1970s but nothing happened.

“People have to be careful,” he said.

“There are no free lunches, sometimes people will face horrendous haulage charges especially with the loss of RET and after-sales are practically non-existent.”

A Buy local campaign was launched several years ago in an effort to sustain the local economy of the islands following business seminars.

The OFT has written to six retailers asking them to stop using pricing practices that mislead consumers.

OFT director Gaucho Rasmussen said: “OFT research has found that reference pricing can mislead consumers into thinking the item they have bought is of higher value and quality, pressure them to buy there and then so they don’t ‘miss out’ on the deal and also impair their judgement, as buying an item immediately means they do not get the chance to search the market for the real best deals.

“We have contacted a number of carpet and furniture retailers asking them to review their pricing practices and sign legally enforceable undertakings.”

Recently Tesco was fined £300,000 for misleading customers over what it claimed were “half-price” strawberries.